Correlation Between SunLink Health and Microbot Medical
Can any of the company-specific risk be diversified away by investing in both SunLink Health and Microbot Medical at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining SunLink Health and Microbot Medical into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between SunLink Health Systems and Microbot Medical, you can compare the effects of market volatilities on SunLink Health and Microbot Medical and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in SunLink Health with a short position of Microbot Medical. Check out your portfolio center. Please also check ongoing floating volatility patterns of SunLink Health and Microbot Medical.
Diversification Opportunities for SunLink Health and Microbot Medical
-0.25 | Correlation Coefficient |
Very good diversification
The 3 months correlation between SunLink and Microbot is -0.25. Overlapping area represents the amount of risk that can be diversified away by holding SunLink Health Systems and Microbot Medical in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Microbot Medical and SunLink Health is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on SunLink Health Systems are associated (or correlated) with Microbot Medical. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Microbot Medical has no effect on the direction of SunLink Health i.e., SunLink Health and Microbot Medical go up and down completely randomly.
Pair Corralation between SunLink Health and Microbot Medical
Considering the 90-day investment horizon SunLink Health Systems is expected to under-perform the Microbot Medical. In addition to that, SunLink Health is 2.25 times more volatile than Microbot Medical. It trades about -0.06 of its total potential returns per unit of risk. Microbot Medical is currently generating about 0.16 per unit of volatility. If you would invest 90.00 in Microbot Medical on September 19, 2024 and sell it today you would earn a total of 7.00 from holding Microbot Medical or generate 7.78% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
SunLink Health Systems vs. Microbot Medical
Performance |
| Timeline |
| SunLink Health Systems |
| Microbot Medical |
SunLink Health and Microbot Medical Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with SunLink Health and Microbot Medical
The main advantage of trading using opposite SunLink Health and Microbot Medical positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if SunLink Health position performs unexpectedly, Microbot Medical can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Microbot Medical will offset losses from the drop in Microbot Medical's long position.| SunLink Health vs. ASGN Inc | SunLink Health vs. Kforce Inc | SunLink Health vs. Kelly Services A | SunLink Health vs. Central Garden Pet |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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